[Suit No.

22-216-1999-III]

MALAYSIA IN THE HIGH COURT IN SABAH AND SARAWAK AT KUCHING SUIT NO: S-22-216-1999-III
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BETWEEN TAY CHOO FOO AND TAN LIM HIAN @ ADIJANTO

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. . . .

PLAINTIFF 1ST DEFENDANT 2ND DEFENDANT 3RD DEFENDANT

SOENARYO PRIOSOETANTO BUMI RAYA UTAMA GROUP

JUDGMENT
Introduction
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The plaintiff claim is for 10% of the value of the shares of the Sarawak Clinker Sdn Bhd which is estimated at RM35 million. The claim is based on an oral promise allegedly made by the 1st defendant. The plaintiff testified on his own behalf apart from calling two other witnesses. By the time of trial, the 1st defendant had passed away. His son represented his estate. The 2nd defendant, who is the brother of the 1st defendant, did not defend the action. Judgment in default had been entered against him for the very same claim in another suit. No one represented the 3rd defendant as the 1st defendant took the position that the 3rd defendant is not a legal entity and does not exist. In the premises, the only defendant faced by the plaintiff at the trial was the representative of the estate of the 1st defendant. Plaintiffs case The plaintiff is a businessman based in Kuching. He is 65 years old. The 1st defendant was apparently a very rich Indonesian Chinese businessman
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with interests in various sectors in Indonesia and overseas. He died after the instant suit was filed. The 2nd defendant is his brother. He did not defend the action. He did not come to court to testify for either side. According to the son of the 1st defendant, he has been estranged from the
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family even before the 1st defendant died. The 3rd defendant has been described by the plaintiff as a firm in which the 1st and 2nd defendant were partners. The case of the plaintiff is as follows. He met the 1st defendant in Kuching sometime in 1989 over some oil palm plantation business. The 1st defendant wanted investment opportunities for his business group

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known as Bumi Raya Utama Group (BRUG). The plaintiff knew one Datuk Effendi Norwawi, who was the then Chairman of the Sarawak Economic Development Corporation (SEDC). By coincidence, Datuk

Effendi had asked the plaintiff whether anyone was interested in a clinker project in Sarawak. At that time, a company known as Sarabah Clinker
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Sdn Bhd was involved in the clinker project. It was a joint venture between Sarawak Economic Development Corporation (SEDC) and Sabah Economic Development Company (SEDCO). The plaintiff said that once the 1st defendant was interested, he did all the ground work in securing the project for BRUG. He introduced the 1st defendant to Datuk Effendi and

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to the Chief Minister of Sarawak. Eventually BRUG managed to secure the project. They paid over RM6 million to buy out the interests of SEDC and SEDCO in the project. The new vehicle to carry out the clinker project was known as Sarawak Clinker Sdn Bhd. This was a joint venture project as there was an arrangement for BRUG to sell 40 per cent of the

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shares to SEDC after three to four years. The value of the shares was to be based on the costs of the machineries. As it happened, SEDC did not exercise its option to buy 40% of Sarawak Clinker Sdn Bhd. The

company was ultimately sold to its present owners which is CMS Sdn Bhd.
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The plaintiff said that he organised the signing ceremony which was graced by the Chief Minister himself on 15th September 1991. The plaintiff said that he made about 15 overseas trips with the 1st defendant to source for machineries. He said that for all his troubles, he was promised
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10% free share in Sarawak Clinker Sdn Bhd and a directorship as well. However, the 1st defendant never kept his side of the bargain by transferring 10% free equity to him. When he finally demanded the 10% free equity, he was told to subscribe by paying cash. As the investment in the machineries was estimated and declared at RM350 million by BRUG

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to SEDC, the plaintiff is now claiming RM35 million from the estate of the 1st defendant. The plaintiff called two witnesses to support his case. One of these witnesses is an accountant. He prepared a project paper which contained a feasibility study on the clinker project. The purpose of the project paper was to obtain financing from MUI Bank. He was

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instructed by the plaintiff but his fee was paid by the Indonesians. He was told by the plaintiff himself that he had been given 10% share in the project. He candidly admitted that the 1st defendant did not tell him about the 10% share that was allegedly given to the plaintiff. According to his study, the total investment that was required was RM280 million. It is not

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disputed by the parties, that the loan that was used for the clinker project did not come from MUI Bank. The other witness that the plaintiff called was Sii Kie Wong, a former officer of SEDC. He was tasked by the Chairman of SEDC to discuss the clinker project with BRUG. He said that during a meeting, the 1st defendant told him that the plaintiff was his

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Kuching representative. The plaintiff told him that he would be getting 10% share and a directorship if the project was successfully implemented. However, during cross-examination, he agreed that he did not hear that from the 1st defendant himself. Apart from relying on his own oral testimony and the testimony of his two witnesses, the plaintiff also placed
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considerable reliance on a letter allegedly written to him by the 2nd defendant. The 2nd defendant allegedly wrote this letter after the 1st

defendant had told the plaintiff to pay for the 10% share of Sarawak Clinker Sdn Bhd in cash. In this letter, which was written in Bahasa
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Indonesia, the 2nd defendant purported to acknowledge the promise made by his brother to give 10% share to the plaintiff. This is essentially the case of the plaintiff. 1st defendants case The estate of the deceased called only two witnesses, i.e. the son of the

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deceased (Pandjijono Adijanto @ Tan Hong Phang, D.W. 1) and one Chan Poh Kim (D.W. 2). Pandjijono Adijanto testified that he was closely involved with the family business since 1978. He said the entire family business of which the deceased was the head and founder was conveniently called Bumi Raya Utama Group or BRUG. It was not a

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legal entity as the actual businesses were operated by individual companies. They had interests in various industries including By 1991, the deceased had designated

transportation and forestry.

Pandjijono Adijanto as his successor. Therefore, Pandjijono Adijanto was kept in the loop of the family business by his late father. He said that
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around 1990, his father sent Chan Poh Kim who looked after the family business in Malaysia to go to Sarawak to look for opportunities in a plywood project. His father told him that he met the Chief Minister of Sarawak on his own initiative for the purpose of securing a timber concession. His father did not succeed in getting a timber concession but

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was given the opportunity to invest in a clinker manufacturing project. Pandjijono Adijanto participated in the meetings between his father, his assistant (Dr. Lim Soon Tham) and Chan Poh Kim (D.W. 2) and the SEDC officials. As a result of the successful negotiations, his family
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bought out the shares of SEDC in Sarawak Clinker Sdn Bhd. However, at the time of the signing ceremony which was graced by the Chief Minister, the name of BRUG was used as his father had not decided which family company would execute the actual agreement with SEDC. In the end,
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Landstone Pte Ltd which is a company controlled by his family signed the agreement with SEDC. Pandjijono Adijanto said that the plaintiff only played a minor role in his familys acquisition of Sarawak Clinker Sdn Bhd. He said that the plaintiff had constantly worked to ingratiate himself with his late father as he wanted to win contracts from him. His efforts

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paid off as the deceased awarded him a contract to plant acacia on family lands in Pontianak. In respect of the clinker project, Pandjijono Adijanto said that the plaintiff only facilitated in organizing the signing ceremony, making hotel bookings, coordinating meeting with government officials and driving his father around whenever he came to Kuching. He was

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emphatic that the plaintiff was not involved in any of the key negotiations in respect of the clinker project. He also said that MUI Bank was not involved in financing the project. He said that his father never offered 10% free equity to the plaintiff. However, he made an offer to the

plaintiff in January of 1992 to subscribe to 10% of the shares. Pandjijono

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Adijanto was personally present during this meeting which was held at the lobby of the Kuching Hilton Hotel. He heard the plaintiff decline the offer as he did not have the money. He did not hear the plaintiff

protesting that he should be given free equity for his time and effort. He said that he heard from his father that the plaintiff subsequently
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telephoned him to confirm that he would not be subscribing to the shares of Sarawak Clinker Bhd. The only other witness for the estate of the 1st defendant was Chan Poh Kim (D.W. 2). He is a Singaporean who

handled the family business of the deceased in Malaysia. He was in charge of arranging finance for the clinker project. The loan that was
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obtained for the project was a RM170 million loan syndicated by CIMB Bank. He said the plaintiff was never involved in any of the negotiations in respect of the financing of the project. Issues
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The core issue raised by the plaintiff is a simple one, i.e. that for the time and effort he expended on behalf of the defendants in securing the clinker project, he was promised 10% free equity in Sarawak Clinker Sdn Bhd. The failure of the defendants, especially the 1st defendant to honour the bargain gave rise to a cause of action in contract. Since the 1st defendant

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had declared the value of machineries at clinker plant at RM350 million, the plaintiff claims that he is entitled to RM35 million in damages. Counsel for the 1st defendant, on the other hand had raised numerous issues. They can be grouped as follows: 1. That the 3rd defendant is not a legal entity and there is no evidence

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that the 1st defendant was its managing partner. 2. That the action is a duplicity and an abuse of the process of the court. 3. That the action is time barred. 4. That on the evidence there was no contract to allot 10% free equity

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to the plaintiff Whether the 3rd defendant is a firm and whether the 1st defendant is its managing partner? The plaintiff has pleaded his case against the 1st defendant in his

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individual capacity and in his capacity as the managing partner of the 3rd defendant. The plaintiff has pleaded that the 1st and 2nd defendant are partners in the 3rd defendant. In my opinion, counsel for the 1st defendant
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is correct to argue that the plaintiff has failed to tender any evidence of the existence of the 3rd defendant. The plaintiff has only relied on the

letterheads bearing the name BRUG and the clinker project signing ceremony presided by the Chief Minister. The letter mentioned a group
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by the name of BRUG but gave no details of its existence as a legal entity. Counsel for plaintiff argued that it is an unregistered partnership of the 1st and 2nd defendant. However, apart from the letterhead, the plaintiff has not tendered any details of the existence of such a firm either in Malaysia or Indonesia. In fact at page 89 of the plaintiffs own bundle of

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documents, there is a letter from a law firm in Kuching that states categorically that BRUG is not legal entity but a name by which their clients refer to themselves. The letter is addressed to SEDC. The letter specifically states that a company known as Landstone Investments Ltd which is 80% owned by the 1st defendant would sign the main agreement on the joint venture project with SEDC. This letter is dated 31st December 1991. Pandjijono Adijanto testified that BRUG does not exist as business entity but it is a general name of all the family businesses that are operated under individual companies. He was not convincingly challenged during cross-examination. In the premises, I find that the plaintiff has not proved on a balance of probabilities that the 3rd defendant is a business or a legal entity. Therefore the claim against the 1st defendant in his capacity as a managing partner of the 3rd defendant cannot be sustained. The plaintiff has also pleaded his action against the 1st defendant in his individual capacity for promising him 10% free equity, although in his evidence he said that his agreement was with BRUG and not with the 1st defendant. However, for sake of completeness I shall consider this claim later in my judgment.

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Whether the action is a duplicity and an abuse of the process of the court? Counsel for 1st defendant submitted that the action is an abuse of the process of the court for the following reason. The plaintiff had filed an
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earlier suit (Kuching Suit No. 22-32-1997-(II) against the same defendants. The plaintiff entered judgment in default against the 2nd

defendant. He has yet to execute the judgment in default. However, he did not manage to serve the writ on the other defendants. He obtained an order to renew the writ until August of 2000. In the interim he filed the
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present suit without withdrawing the earlier suit. The remedies and reliefs in both suits are identical. Counsel for 1st defendant cited the case of Lesco Development Corp Sdn Bhd v Malaysia Building Society Bhd [1988] 2 MLJ 184. In that case, the Supreme Court held at page 185 that:
It is undesirable to allow a situation where two different courts would try

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and determine the same issues arising between the same parties relating to the same subject matter.

He also cited Re Joseph Ambrose Lee; Mayban Securities Sdn Bhd (previously known as Phileoallied Securities Sdn Bhd) v Dato Joseph Ambrose Lee [2005] 7 MLJ 483 and J.H. Rayner (Mincing Lane) Ltd &
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Ors v Manilal & Sons (M) Sdn Bhd & Anor [1987] 1 MLJ 312 to support his argument that the plaintiff had run foul of the rule against duplicity of actions. However, in my view, all the above cases can be distinguished. In the instant case, the earlier proceedings never took off as the writ lapsed in 2000 without it being served. Therefore the question of the

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plaintiff proceeding with both actions against the defendants cannot arise unlike in the cases cited.

[Suit No. 22-216-1999-III]

Whether action barred by limitation? The plaintiffs claim is allegedly based on the oral promise made by the 1st defendant to allot free equity to the plaintiff for his involvement in the clinker project. Counsel for the estate of the 1st defendant submitted that
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the limitation period for the cause of action suggested in the Statement of Claim of claim is only three years. The defence of limitation is pleaded in paragraph 13 of the Statement of Defence. Article 46 of Part III of the Schedule to the Limitation Ordinance of Sarawak provides that the limitation period for compensation for breach of a promise to do anything

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at a specified time, or upon the happening of a specified contingency is three years. The limitation period is stated to run from the time specified or from the time the contingency happens. Counsel for plaintiff has not argued that the limitation period is more than three years. As submitted by counsel for the 1st defendant, the plaintiff had not been very specific

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when the promise of allotment of free equity was made. The plaintiff pleaded in the Statement of Claim that he initiated the joint venture in 1991. However, he does not say that he was immediately entitled to the 10% free equity. If he was immediately entitled to the free equity, he would have been out of time as the suit was only filed in October of 1999.

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The plaintiff pleaded in paragraph 11 of the Statement of Claim as follows:

11. On the 22nd day of January, 1992, the Defendants, instead of

allotting to the Plaintiff the free equity in the said Company, demanded the Plaintiff to contribute full cash payment towards the free equity in the said
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Company. The Plaintiff did not agree to such demand of the Defendants.

The plaintiff did not institute any action or make a demand after this date. Instead he immediately faxed a letter to the 1st defendant stating he would not be taking up the offer to subscribe 10% of the equity of Sarawak
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Clinker Sdn Bhd. If the refusal of the plaintiff is taken as the point of time from which the limitation period is made to run, the action would have become time barred by January of 1995. However, the plaintiff pleaded in paragraph 12 of the Statement of Claim as follows:
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12.

Subsequently, it was agreed between the Plaintiff and the

Defendants that the claim of the Plaintiff against the Defendants towards the free equity in the said Company be held in abeyance till the clinker plant in the Project be operational and in production. (emphasis supplied)
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Assuming that the plaintiff is telling the truth that there was a fresh agreement subsequent to the meeting at the Hilton Hotel Lobby, the plaintiff would still be out of time. This is because, by the plaintiffs own admission, the clinker plant was already operational by early 1996. This is what the plaintiff said during cross-examination:

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Q: A:

When was the Clinker Plant operational? Towards the later part of 1995 because commission of machineries is repeating process, normally it takes 6 months to run the plant to be operational and gradually increasing the productivity.

Q:
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When was the Clinker Plant in production? If I am not mistaken, early 1996. But the Defendant always try to avoid me inspecting the site especially checking the quality of the machineries fabricated from different parts of China. Therefore, I was not given the privy of knowing some details operation in clinker plant especially matters relating to financial matters.

A:

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(emphasis supplied)

The plaintiff pleaded in paragraph 12 of the Statement of Claim that the 1st defendant agreed to delay allotting the free equity until the clinker plant was operational and in production. Although the plaintiff pleaded that the
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clinker plant was operational in December of 1996, during crossexamination, he has conceded that the specified contingency occurred in early 1996. In the premises, by any reckoning, the three year limitation period would have expired by early 1999. This action was only instituted
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on 19th October 1999. I have not omitted to consider that the plaintiff pleaded as follows in paragraph 13:
13. On the 29th day of January, 1997, the Plaintiff, vide his letter to

the Defendants of 'idem date', demanded the Defendants, to compensate him a fair sum of his 10% interest in the said Project. The Defendants
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denied any liability towards the claim of the Plaintiff.

In my opinion, the limitation period cannot run from the date of demand for the reason that article 46 enacts that the limitation period would run from the date of happening of a specified contingency. In this case, assuming that the plaintiff is telling the truth that the 1st defendant had
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subsequently agreed to allot him the 10% free equity, the limitation period would have run from early 1996 when the clinker plant started production. In the premises, the plaintiff was clearly barred by limitation law from instituting this action. On this ground alone, I would dismiss this action. However, I shall proceed to consider the core issue in this case, i.e. whether the plaintiff and 1st defendant had entered into an agreement whereby 10% free equity should have been allotted to the plaintiff. Whether the plaintiff was entitled to 10% free equity? The issues that arise are whether the plaintiff and 1st defendant had entered into an agreement that gave rise to the entitlement of 10% free equity,

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whether there was breach of it and whether any damages were due. The plaintiff did not rely on any written agreement for the 10% free equity. He based his claim on an oral agreement. In the absence of a

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written agreement, the evidences that the plaintiff relied on to prove his claim are: (a) The testimony of P.W. 1 and P.W. 2. (b) A letter purportedly written by the 2nd defendant to the plaintiff.
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(c) His own testimony. According to the plaintiff, the 1st defendant repeated his promise of giving him 10% free equity in the presence of SEDC officers. One of the SEDC officers (P.W. 2, Sii Kie Wong) was called to testify on his behalf but the other officers were not. In my opinion, the evidence of P.W. 2 does not

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support the evidence of the plaintiff that he was promised 10% free equity. P.W. 2 frankly told the court that he only guessed that the 1st defendant had made an offer of 10% free equity to the plaintiff. This is because the 1st defendant said during the meeting that the plaintiff is his Kuching representative. P.W. 2 was not sure if the 10% free equity was mentioned because his Bahasa Indonesia is limited. The late 1st defendant spoke in Bahasa Indonesia and Teochew only. In the premises, the evidence of P.W. 2 does not cast any light on the alleged oral agreement between the plaintiff and the 1st defendant. He only heard about the 10% free equity from the plaintiff.

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Similarly P.W. 1 (Lee Khim Sin) who allegedly prepared a project paper for financing did not hear about 10% free equity from the 1st defendant. This is what he said in evidence about the 10% free equity:
Q: Look at Q 10, 11 & 12. At any time did Adijanto ever tell you that he is giving Tay Choo Foo 10%?

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A:

No.

The plaintiff also referred to the letter (exhibit P1, dated 24th January 1992) that was allegedly sent by the 2nd defendant after that fateful
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meeting at the Hilton Lobby wherein the 1st defendant rebuffed the request for 10% free equity and told the plaintiff to subscribe for it by paying cash. This letter was written by the 1st defendant in Bahasa Indonesia. The professed purpose of the letter appears to be a plea by the 2nd
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defendant to repair relations between the parties and urge the plaintiff not to take any drastic action. However, in this letter the writer refers to the 10% free equity made to the plaintiff by the 1st defendant. This letter was admitted into evidence as the plaintiff claimed that he received it. The 1st defendant however disputed the contents of the letter. It is trite law that

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although a document may be admitted into evidence, the weight given to it is a separate matter. The 2nd defendant did not defend this action. There was virtually unchallenged evidence from Pandjijono Adijanto that the 2nd defendant had been estranged from the family business of the 1st defendant. There is also evidence that the 2nd defendant was not involved in the clinker project. The plaintiff himself said that the 2nd defendant only came once to see the Chief Minister when the machineries were stuck at the port. The 2nd defendant was not at the signing ceremony. The 2nd defendant was not a shareholder or a director. He is also not a

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guarantor of the syndicated loan that was taken for the clinker project.
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Pandjijono Adijanto disputed the truth of the contents of the letter, especially the statement in respect of the 10% free equity. In the

premises, since the plaintiff is relying on the letter to prove that he had been promised 10% free equity by the 1st defendant, he should have called the 2nd defendant as his witness. The 2nd defendant wrote the said letter on
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behalf of BRUG. For the reasons stated earlier, there was no evidence of a partnership between the 1st and 2nd defendant in BRUG. The question that would arise in the circumstances is whether the 2nd defendant can bind the 1st Defendant by the said letter. There is no evidence that the 1st defendant had authorized the said letter. Furthermore the contents of the
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letter are disputed now. As stated in Chong Khee Sang v Pang Ah Chee [1984] 1 MLJ 377 by Shankar J:
Certainly the law must be that once a document is included in an Agreed Bundle, it is no longer necessary to prove their existence or execution. Nor
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is it necessary to produce the original. But so far as the contents of the documents are concerned the truth of the same has still to be proved, in the absence of any specific admission of the facts therein contained.

Therefore, the plaintiff should have called the 2nd defendant to explain the 10% free equity referred to in the letter. Since the 2nd defendant did not
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testify, no weight should be given to the said letter in considering whether the 1st defendant had promised 10% free equity to the plaintiff. Therefore, the only evidence of the oral contract is the testimony of the plaintiff. The plaintiff told that court that he was promised 10% free equity by the 1st defendant for his time and effort if the clinker project

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took off.

The exact date of the oral agreement is not stated by the

plaintiff. The plaintiff pleaded that the he was the one who initiated the joint venture deal. In his witness statement, the plaintiff said he had been promised many times that the 10% free equity would be allotted to him by the 1st defendant.
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He said as follows in the witness statement in

paragraphs 29 and 30:

29. Why would you want to do all that for the Indonesians? I was promised 10% free shares by Adijanto. 30. When did he make this promise? Many times, from the beginning. He said the same even to others.

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The only witnesses he called were P.W. 1 and P.W. 2. He did not call the other SEDC witnesses. As stated earlier, the witnesses he called were unable to verify what the 1st defendant allegedly said about the 10% free

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equity to the plaintiff. During cross-examination, he said as follows about the genesis of the oral agreement:
Q: A:
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What did the late 1st Defendant allegedly represent to you? The late 1st Defendant in order to encourage me to use my influence to get the deal, he always impress upon me by telling me and also my wife and myself that he would give me 10% free share if I could get Datuk Effendi to agree to the take over of Sarawak clinker and also the CM to approve.

The plaintiff said that he arranged for the 1st defendant to see Datuk
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Effendi and the Chief Minister. Pandjijono Adijanto told otherwise. He said he was involved in the clinker project from the beginning. He said his father arranged the meeting with the Chief Minister on his own initiative. The 1st defendant wanted a timber concession from the Chief Minister but instead he was told of an opportunity to invest in the clinker

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project. Be that as it may in respect of the question of arranging meeting with high officials such as Datuk Effendi and the Chief Minister, the essential question that arises is whether the 1st defendant and the plaintiff had concluded an enforceable oral contract in respect of the 10% free equity or its worth that the plaintiff is now claiming. Bearing in mind that

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the burden of proof is on the plaintiff, I am of the opinion that he has failed to discharge it on a preponderance of probabilities. My reasons are as follows. Although the alleged contract was not in writing, the plaintiff is not relieved of his duty to prove the essentials of a valid and binding contract.

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The plaintiff had been generally vague about facts which would support the existence of an oral contract. To keep things in perspective, it must not be forgotten that the plaintiff is claiming 10% equity in Sarawak Clinker Sdn Bhd or RM35 million by claiming the existence of an oral contract between him and the 1st defendant. He was never specific about
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the date of the contract. I have alluded to his evidence on this point earlier. He did not define the said oral contract in terms of offer,

acceptance and consideration. Throughout his evidence he referred to the promise made by the late 1st defendant to allot him 10% free equity in
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the event the clinker project was successful. However, he shifted the date of allotment to the point of time when the clinker plant would commence production. In the first place, I find that the existence of a binding contract to allot 10% free equity to the plaintiff as utterly implausible. From the evidence, all that the plaintiff did was to organize the ferrying of the 1st defendant and his party around Kuching and arranging introductions to senior government officials. It is disputed whether the plaintiff introduced the 1st defendant to Datuk Effendi and the Chief Minister. Even if I were to accept the evidence of the plaintiff that he did introduce them, I do not find it probable that the 1st defendant on this account alone would have agreed to allot 10% free equity share to him. Pandjijono Adijanto told the court his late father failed to obtain a timber licence which was his main purpose of coming to Sarawak. Instead he was told of an opportunity to invest in a clinker project. The 1st defendant was also told that the clinker

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project would require a huge investment of about RM450 million. In the premises, it seems highly improbable why an experienced businessman such as the 1st defendant who has diversified interests in Indonesia and Malaysia would want to allot 10% free equity to the plaintiff whose only role was to make introductions and do some peripheral work in arranging

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the signing ceremony and ferrying him around Kuching. The plaintiff claimed that he also went overseas with the 1st defendant to look at machineries for the clinker plant. However there is no conclusive proof from the photographs that the plaintiff was involved in the clinker project
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except on the periphery.

The plaintiff exhibited some letters that he

signed using the BRUG letterhead. However, the plaintiff himself told the court he had not been made director of Sarawak Clinker Sdn Bhd. There is no evidence that he held any formal position in the so-called
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partnership called BRUG. It is more likely that he used the letterhead because he was helping to organise the signing ceremony and coordinating meetings. In the second place, there is a lack of a definite offer and acceptance element in the testimony of the plaintiff. The plaintiff related that he met the 1st defendant through dealings in the oil palm business. He introduced him to Datuk Effendi who had told him about an opportunity to invest in the clinker project. He then arranged for the 1st defendant to meet the Chief Minister. According to the plaintiff, the 1st defendant had

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repeatedly promised him 10% free equity in the clinker project. However
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the plaintiff himself never told the court that he would not have done all these running around unless he was going to be given the 10% free equity. To put it in another way, the question is whether the plaintiff had offered to do certain things for the 1st defendant in exchange for the 10% free equity. The converse position would be whether the defendant had

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offered 10% free equity in exchange for the services of the plaintiff. In both these situations, the offer should be followed by a definite acceptance in order to constitute a valid contract. However, the general picture that emerges from the entire testimony of the plaintiff is that he had performed services for the 1st defendant who promised him 10% free equity. It is

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very difficult to discern the element of a definite offer and acceptance in their dealings. The plaintiff was not specific that he had a bargain with the 1stdefendant. The following answers of the plaintiff during crossexamination suggest this conclusion:
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The late 1st Defendant in order to encourage me to use my influence to get the deal, he always impress upon me by telling me and also my wife and myself that he would give me 10% free share if I could get Datuk Effendi to agree to the take over of Sarawak clinker and also the CM to approve.
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.. I remember the late 1st Defendant made the promise before I brought him to see Datuk Effendi in Kuching, after the meeting, he was very happy and again repeating his commitment of 10% free share to me, maybe just to inspire me to work harder to get the project. He kept repeating this,

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maybe to show that he was very kind. . And remember he said it very loud, that I give Tay Choo Foo 10% free share, maybe just to show that he was very generous, I remember Sii Kie Wong was there.

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(emphasis supplied)

The element of offer and acceptance is not clearly borne out in the evidence of the plaintiff which I quoted above. In any event, I disbelieve the plaintiff that the 1st defendant had made an oral contract whereby he would give 10% free equity in Sarawak Clinker Sdn Bhd in exchange for
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his services in arranging introductions to high officials in Sarawak, accompanying him on overseas trips and for running errands for him in Kuching. The plaintiff was not even involved in the crucial task of

securing the syndicated loan of RM170 million for the project as that was done by Chan Poh Kim (D.W. 2). From the outset, it was known to both
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the plaintiff and the 1st defendant that the clinker project requires investment in the hundreds of millions of ringgit. The plaintiff, by his own admission, did not invest any money at all into the project. His contribution was purely in organizing the signing ceremony and running errands for the 1st defendant when he was in Kuching. At the inception of

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the project, no money had been injected into it. This is a capital intensive

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project as the machineries alone cost over hundreds of millions of ringgit. A syndicated loan of RM170 million with several banks was ultimately secured to finance the project. If indeed it is true that the 1st defendant had agreed to give 10% free equity in the company to the plaintiff, common
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sense and logic demands that he would have done so at the inception of the project so that the plaintiff would partake in the risks involved. Instead the plaintiff would have the court believe that according to the oral agreement, the 10% free equity would only be allotted when the clinker plant commenced production. I find this highly improbable. All the parties involved in the project such as the 1st defendant, Pandjijono Adijanto and other family members had executed a guarantee for the RM170 million loan which was presumably used to purchase the expensive machineries for the clinker project. It beggars belief why the 1st defendant would have agreed to allot 10% free equity and a directorship to

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someone who did not share the risk of guaranteeing such a huge loan. Since the plaintiff conceded that there was no written agreement, his evidence has to be weighed against the inherent probabilities of the case. I find it utterly improbable that the 1st defendant would have concluded such an oral contract where for mere introductions, coordinating meetings

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and doing some work on the periphery of a huge project, the plaintiff is in a position to make a claim for RM35 million. I also believe Pandjijono Adijanto (D.W. 1) who told the court that he was involved in the clinker project from the beginning and that he would have known about the allegation of the plaintiff if it were true.

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Finally, I am in agreement with counsel for the 1st defendant that the fax memo (exhibit D8) the plaintiff wrote to the 1st defendant after the Hilton Lobby meeting conclusively decides the case against the plaintiff. After the 1st defendant refused to give the plaintiff 10% free equity and invited
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[Suit No. 22-216-1999-III]

him to subscribe by paying cash, the plaintiff wrote him the following memo:
SUBJECT: SARAWAK CLINKER SDN BHD
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MESSAGE: Further to our tele-con. instant regarding my share equity in the above co., I have to withdraw my participation as I am not in the position to subscribe my share in cash. Your kind consideration is much appreciated. Thank You.

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Tay Choo Foo

To my mind, assuming that the plaintiff was entitled to the free equity in Sarawak Clinker Sdn Bhd, there was no reason for him to say that he was withdrawing his participation as he was not in a position to subscribe in cash. The plaintiff has not denied writing this memo to the 1st defendant.
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He did not say that he was under duress, threat or coercion when he signed the memo. In other words, it was written voluntarily. There is no a hint of protest or indication in the memo that that the plaintiff would insist on his legal rights under the alleged oral contract to his entitlement of the promised sweat equity. The irresistible inference that can be drawn from

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this fax memo is that the oral contract to allot 10% free equity in Sarawak Clinker Sdn Bhd to the plaintiff did not exist. I, therefore, find on a preponderance of probabilities that the plaintiff failed to prove the existence of the oral agreement. Damages

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Assuming I am wrong on liability, I shall now make known my views on damages. The plaintiffs claim is premised on 10% free equity of

Sarawak Clinker Sdn Bhd. The plaintiff told the court that he is claiming RM35 million simply because the defendants declared to SEDC that the worth of the machineries that were purchased were RM350 million.
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[Suit No. 22-216-1999-III]

However, in same breadth he told the court that the 1st defendant was trying to cheat SEDC because the machineries were of lower quality from China which were worth only RM180 million. There is also

evidence that the 60% of the clinker project was to be financed by a

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syndicated loan. In the premises, given the fact that the plaintiff himself alleged the machineries were only worth RM180 million and 60% of the project was financed by a syndicated loan, the worth of the company when it started production in early 1996 cannot be worth RM350 million. The plaintiff has not given any plausible evidence in respect of the value of the

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company at the time he was allegedly entitled to the 10% free equity. In the premises, even if the plaintiff succeeded on liability, I would not have made any award of damages. In conclusion, the claim of the plaintiff is dismissed with costs to be taxed unless otherwise agreed.

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(RAVINTHRAN PARAMAGURU) Judicial Commissioner

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Date of Delivery of Judgment: 26.10.2010 Date of Hearing:

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18.2.1010 12.3.2010 24.3.2010 14.4.20101 10 & 11.6.2010 20.7.2010 Mr. Mohd Ivan Hussein Messrs Ivan Hussein & Co. Advocates Kuching

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For Plaintiff:

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[Suit No. 22-216-1999-III]

For the 1st Defendant:

Mr. Idris Abdullah and Ms Ratna Devi Messrs Idris & Co. Advocates Kuching

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Notice:

This copy of the Court's Reasons for Judgment is subject to editorial revision.

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